From 2 July, ESG rating providers operating within the European Union will, for the first time, be subject to a regulatory framework[1] and to supervision by ESMA (the European Securities and Markets Authority), which already oversees credit rating agencies. This unprecedented development reshapes the rules of the ESG market.
[1] Regulation (EU) 2024/3005 published on 12 December 2024
A pivotal moment for ESG credibility
This new legal framework marks a key milestone in the structuring of sustainable finance in Europe. Its objective is clear: to strengthen transparency, the quality of ratings, and thus investor confidence.
This regulation is part of a broader effort to structure the European sustainable finance market, alongside upcoming regulatory developments, notably the future revision of SFDR (the Sustainable Finance Disclosure Regulation), which will further strengthen transparency requirements regarding the use of ESG data and ratings.
EthiFinance fully engaged in this transformation
EthiFinance has been preparing for this regulation for a long time (for example, by discontinuing its corporate advisory activities as early as 2024, publishing all of its methodologies, and separating its commercial and analytical functions from 2025). This is a familiar topic for the agency, as its credit rating activities have already been supervised by ESMA since 2012.
2026 marks an acceleration, with a dedicated project team mobilising all relevant functions (legal, production, sales, governance, HR, IT, etc.).
The main changes will focus on four major pillars:
- Governance: creation of a subsidiary dedicated to regulated ESG activities, and strengthening of the existing framework for conflicts of interest;
- Transparency: review of all published methodologies to ensure compliance with the regulation’s format and transparency requirements;
- Quality: strengthening of the quality framework, both in terms of data sources (with priority given to published data) and the verification process prior to publication;
- Stakeholders: implementation of notification procedures for rated entities prior to publication, and structuring of a complaints-handling system.
Through these changes, EthiFinance consistently reaffirms both its commitment and its quality standards.
- With the ambition to champion a distinctly European approach to ESG ratings, grounded in double materiality and in-depth knowledge of the specific features of European companies.
- This commitment to quality and transparency must apply equally to ESG ratings and to ESG data.
This is an important issue for investors, who are likely to face enhanced reporting requirements on both ratings and underlying data under the forthcoming SFDR 2.0.
Against this backdrop, EthiFinance reaffirms its ambition: to champion an independent, regulated and credible European alternative that contributes to the sovereignty of the European financial ecosystem.
“This regulation demonstrates the growing importance of ESG ratings in investment decision-making.
We anticipated it and see it as an opportunity to raise standards, strengthen the quality of analysis, and consolidate investor confidence in this decision-support tool,” said Carol Sirou, CEO of EthiFinance.
About EthiFinance
Based in Paris, with more than 130 employees across Paris, Lyon, Madrid, Granada and Hanover, EthiFinance is a pioneer in ESG ratings with more than 20 years of experience.
The company supports more than 400 clients through its credit and ESG rating, research and advisory services, helping them navigate the challenges of a constantly evolving economic, financial and regulatory environment.
True to its values and DNA, EthiFinance offers a unique and independent European approach to ESG and credit analysis.
Press SEITOSEI.ACTIFIN
Olivier COPPERMANN – olivier.coppermann@seitosei-actifin.com – +33 6 07 25 04 48
Enora BUDET – enora.budet@seitosei-actifin.com – + 33 6 72 17 84 60
